SpiceJet taps warrant route

New Delhi, Nov. 21: SpiceJet today said it would issue convertible warrants to its promoter, which could fetch the budget airline nearly Rs 200 crore at the current price.

The convertible debenture or warrants could be converted into as many as 5.22-crore equity shares, SpiceJet said in a regulatory filing.

These shares will be worth nearly Rs 200 crore at today's closing price of Rs 37.40 apiece on the Bombay Stock Exchange, although the conversion price has not been disclosed.

SpiceJet's board today approved the issue of "convertible debenture and/or warrants convertible into up to a maximum of 52.177 million (5.22 crore) equity shares to the promoter of the company on a preferential basis", the filing said.

Earlier in the day, SpiceJet's promoter Sun Group had said it needed capital for expansion and would explore options, including equity contribution from existing shareholders and raising debt.

The group has, however, denied any plans of a stake sale by promoters.

Sun Group chief Kalanithi Maran and his wife Kavery have resigned from Kal Airways ' one of the promoter entities of SpiceJet ' triggering speculation about a possible sale of the Maran family's majority stake in the carrier.

However, Sun Group chief financial officer S.L. Narayanan said Kalanithi and Kavery Maran had resigned from Kal Airways to organise the board structures of various group firms.

"It is part of a reorganisation to free up time for promoters for other duties. Maran has quit some boards where he was not being able to provide ample time anyway. But his resignation from Kal Airways board should not be inferred as promoters planning to exit or even dilute their stake in SpiceJet," he said.

Maran remains the chairman of the SpiceJet board and continues to provide leadership and direction to the airline, he added. "There are no plans to induct any strategic partner or sell equity stake to any financial investor at the moment."

"We certainly need funds for fleet expansion and whenever there is an attractive opportunity (for partial stake sale), we will definitely look at it, but there is nothing on cards as of now," Narayanan said.